Housing market under unprecedented pressure: what can $1,000,000 buy in Auckland this year?

Barfoot & Thompson managing director Peter Thompson says the property market is facing pressure unprecedented in 40 years. Sales volumes are contracting amid uncertainty in the property market and the global economy.

 

“Property has a seven-year cycle. The last major declines were in 2008 and, before that, 2001.”

 

Peter Thompson said: “I have been in real estate for more than 40 years and have never experienced a cycle like this: rising interest rates, a global economic crisis and the Russia–Ukraine war disrupting supply chains.”

 

“Shortages of timber and plasterboard have pushed up construction costs, which is reflected in the supply of new homes.”

 

“House prices will not fall as much as rumours suggest, but homeowners do need to negotiate on price to meet the market.” He predicts prices will remain broadly flat, with a slight decline, through the end of this year, before potentially starting to rise next year.

 

 

In Auckland this year,

$1,000,000 what kind of home can you buy?

 

In July last year, we compared the properties available across Auckland on a budget of $1,000,000. At the time, Auckland's median house price was $1,150,000, according to REINZ. A year on, dramatic changes in external conditions, including rising interest rates, tighter lending and intensifying inflation, have rapidly turned the market around. In May this year, Auckland's median house price fell back to $1,125,000.

 

With the same $1,000,000 budget, do buyers now have more choice in terms of suburbs, home layouts, location, land area and school zones?

 

According to OneRoof's latest house price figures for June, of Greater Auckland's 276 suburbs, only 28 have an average house price below $1,000,000 NZD, most of them in South Auckland, including Manurewa, Wiri, Clendon, Randwick, Otara, Weymouth and Favona.

In these areas, it is possible to pay $1,000,000 for a renovated property on a cross lease title; there are also opportunities to buy unrenovated but liveable freehold homes on sites of 600 to 700 square metres with development potential, dating from the 1960 s or 1970 s.

House prices in these areas have fallen since the market peaked in November last year. Properties that reached $1,200,000 to $1,300,000 at the peak have now fallen back to around $1,000,000.

33 O'Connor Drive, Pukekohe: a standalone freehold home with 3 bedrooms and 2 bathrooms on 643 square metres of land, sold at auction this Wednesday for $1,042,000.

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33 O\\\'Connor Drive, Pukekohe
Marketed by Diana Cussen, a real estate agent at the Pukekohe branch

61 Senator Drive, Manurewa: a standalone freehold home on 501 square metres of land, with 3 bedrooms and 2 bathrooms, sold at auction this Wednesday for $1,000,000.

61 Senator Drive, Manurewa, marketed by Yugal Sachdeva and Rajiv Kumar, real estate agents at the Manurewa branch

For first-home buyers, New Lynn in West Auckland is certainly a suburb worth considering. Conveniently located and popular with families, New Lynn has seen major upgrades to the Lynn Mall shopping precinct over the past decade. Its train station and bus interchange offer easy access to the CBD.

Buyers may now be able to purchase a 3-bedroom cross-lease home or a brand-new townhouse for NZ$1,000,000.

2/115 Titirangi Road, New Lynn, with 3 homes sharing 1125 square metres of land, 3 bedrooms and 2 bathrooms, sold at auction in May for $950,000.

2/115 Titirangi Road, New Lynn, marketed by Jackie Ostrowski, a real estate agent at the Titirangi branch

Papakura is another suburb with an average house price below NZ$1,000,000. Over the past 10 years, it has transformed from a rural area into an urban one, with numerous new housing developments providing options for young families and homeowners looking to downsize. It offers easy access to the motorway in both directions, is a short drive from Maraetai Beach and is not far from the Hunua Ranges. It also has private schools, temples, sports facilities, restaurants and more.

25J Youngs Road, Papakura: a standalone freehold home on 400 square metres of land, with 3 bedrooms and 1 bathroom, sold at auction in April for $988,000.

25J Youngs Road, Papakura
Marketed by Alison Kemp, a real estate agent at the Papakura branch

Although average house prices in every North Shore suburb exceed $1,000,000, buyers may now be able to find a 3-bedroom cross-lease home in some suburbs for around $1,000,000.

3/11 Selwyn Crescent, Forrest Hill: 3 homes share 1113 square metres of land. With 3 bedrooms and 1 bathroom, it sold at auction in May for $947,000.

3/11 Selwyn Crescent, Forrest Hill, marketed by Kerry Graham and April Howard, real estate agents at the Milford branch

32B Knightsbridge Drive, Forrest Hill: 3 bedrooms and 1 bathroom, with 2 homes sharing 1176 square metres of land, sold at auction in May for $960,000.

32B Knightsbridge Drive, Forrest Hill, marketed by Sue Evans, a real estate agent at the Devonport branch